South Korea’s parliament has impeached acting President Han Duck-soo, deepening the nation’s political uncertainty as suspended President Yoon Suk Yeol faces trial over his controversial imposition of martial law.

The impeachment motion passed on Friday with 192 out of 300 votes, triggering a leadership shake-up and leaving Finance Minister Choi Sang-mok to assume the acting presidency.

The dramatic vote comes in the wake of public outcry and political strife sparked by Yoon’s December 3 declaration of martial law, which led to his own impeachment on December 14.

Opposition parties, led by the Democratic Party, accused Han of failing to act in the nation’s best interests and obstructing the appointment of justices to the Constitutional Court, a move seen as critical to the nation’s governance during this crisis.

Han’s actions amounted to ‘insurrection’?

The Democratic Party, which holds a parliamentary majority, spearheaded the motion against Han, arguing that his actions amounted to “insurrection.”

Opposition leader Lee Jae-myung called for swift action to restore public trust and stability, citing overwhelming public support for Yoon’s removal following his martial law decision.

“The only way to normalize the country is to root out all insurrection forces,” Lee declared in a heated address before the vote.

Despite strong objections from the ruling People Power Party, the impeachment motion passed amid chaotic scenes in parliament, with lawmakers clashing over the validity of the vote.

Han, who had served as acting president since Yoon’s suspension, stated he would step down to prevent further instability and await the Constitutional Court’s ruling on his impeachment.

Choi Sang-mok steps into acting presidency role

Finance Minister Choi Sang-mok has stepped into the acting presidency role, inheriting a challenging economic and political environment.

Prior to the vote, Choi warned parliament against impeaching Han, citing potential harm to South Korea’s economy.

The South Korean won fell to 1,475.4 per dollar, declining 0.53% following news of the impeachment.

The uncertainty surrounding the leadership crisis has raised concerns among investors, with analysts closely monitoring the Constitutional Court’s proceedings.

The court now has 180 days to decide whether to uphold or overturn the impeachment of Yoon and Han, a ruling that could reshape South Korea’s political landscape.

Constitutional Court’s role in the crisis

As the court convened for its first hearing on Yoon’s impeachment, questions loomed over the broader implications of the crisis.

Han’s impeachment marked an unprecedented move, as lawmakers debated whether a simple majority or a two-thirds vote was required to remove an acting president.

Speaker Woo Won-shik clarified that a simple majority was sufficient, paving the way for the motion to pass.

The ongoing trial of Yoon and the leadership vacuum created by Han’s removal have left South Korea at a political crossroads.

Observers note that the Constitutional Court’s decision will not only determine the fate of the country’s leadership but also set a precedent for addressing future political crises.

As South Korea navigates this turbulent chapter, both its political and economic stability hang in the balance, with domestic and international stakeholders watching closely for signs of resolution.

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The FTSE 100 had a solid year overall aided by the Labour party’s landslide victory in the general election, and the Bank of England starting to cut interest rates in what collectively helped boost UK stocks.

The UK’s blue-chip index is up 5.36% year-to-date after reaching an all-time high close of 8,445.80 points in May.

To be sure, the FTSE 100’s rise is still well behind the 27% return delivered by the S&P 500.

Many individual stocks within the FTSE 100 struggled with their shares dropping by more than 10%, and some seeing declines of as much as 20%.

Here’s a closer look at three of the FTSE 100’s worst performers in 2024 and their rebound potential for 2025.

JD Sports Fashion

JD Sports Fashion had a turbulent ride this year marked by multiple profit warnings that have pushed the company’s stock price down by more than 41% YTD.

As 2025 approaches, uncertainty looms due to unpredictable consumer spending and rising costs stemming from the UK’s recent budget.

However, with a price-to-earnings (P/E) ratio of just 6.5, the low valuation, aided by positive trading conditions, could see a substantial rebound.

“Currently, I’m under water. Yet having walked into several JD Sports stores recently and seen plenty of consumer activity, I’m happy to hold,” said Edward Sheldon, CFA, of Motley Fool.

Schroders

Investment manager Schroders (LSE: SDR) declined steadily throughout the year, as challenges in the broader active fund management space dragged the stock down.

On December 27, its share price was down more than 27% YTD.

At current levels, the stock appears to be attractively priced, with a P/E ratio of 10 and a dividend yield close to 7%.

However, the rise of index funds continues to pressure active managers like Schroders, creating an uncertain outlook for 2025.

“Given this trend and the stock’s poor performance during a global bull market, I’m skeptical about its ability to rebound next year and won’t be adding it to my portfolio,” said Sheldon.

Prudential

Asia and Africa-focused insurer Prudential (LSE: PRU) has struggled for nearly two years, largely due to weak economic conditions in China.

Its share price was down by more than 25% YTD on December 27.

The stock’s 2025 movement is likely to depend on China’s economic recovery.

Positive developments could push the share price up, but further deterioration or escalating trade tensions with the US pose significant risks.

‘Now, I own this stock myself. And I’m down heavily (it’s one of the worst performers in my portfolio). But with the stock trading on a low P/E ratio of 7.8, I do believe there’s potential for a recovery. It’s just hard to know if we’ll see this in 2025,” Sheldon adds.

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Brazil celebrates a milestone in job opportunities as the country achieves a record unemployment rate of 6.l% marking a positive trend, in the labour market during the last quarter of 2024 compared to the previous periods 6. 60/0 Rate.

The decrease in unemployment is in line with forecasts, reflecting a promising path towards recovery for Brazil’s economy, according to data published by Brazil’s central bank.

Brazil’s government spending fuels consumer demand

Government spending has significantly boosted consumer demand by boosting consumer confidence and spending habits, which has led to an increase in business operations across sectors due to consumer demand; consequently, hiring prospects have improved, and unemployment rates have been reduced.

Economists think that the government’s smart investments and financial strategies have not just boosted consumer spending but have also set the stage for term expansion.

Brazil’s labour market outlook appears positive due to these ongoing efforts.

Unemployment levels in October

Data from Brazil’s central bank showed that the unemployment rate in Brazil declined to 6.2% in the three months ending October 2024.

The results supported the trend of an improving labour market, reinforcing the case for tighter monetary policy from the Brazilian central bank this year.

However, it increased uncertainties about the policy direction of the new monetary policy committee, which is projected to be more dovish when it takes office in 2025.

The number of unemployed fell by 8% to 6.8 million, while the number of employed rose 1.5% to a new record high of 103.6 million.

Meanwhile, real regular income remained consistent at BRL 3,255 during the quarter, rising by 3.9% year on year.

Employment levels are on the rise as 2024 comes close to an end

Job creation is expected to strengthen more as a result of these initiatives.

The significant drop, in unemployment is mainly credited to the recovery of industries that were previously affected by challenges and external factors.

At the time the overall employment has increased by 1. 4% Hitting a high of 103. 9 Million working individuals.

This expansion signifies a growing job market that not only absorbs those without jobs but also generates employment opportunities that meet the changing demands of the economy.

Rising wages reflect economic improvement

As employment numbers rise wages also see an improvement to reflect the conditions.

The average monthly salaries, in Brazil have gone up by BRL 22 to reach a total of BRL 3​285 per month​.

This rise may be small.

It indicates economic progress and suggests that workers are starting to see the advantages of more job opportunities opening up​.

Rising wages play a role, in improving the lives of Brazilians and can also boost consumer spending​, which in turn benefits the economy through a cycle of positive effects​.

Central bank’s response and future outlook

With the recent improvements, in the job market considered and taken into account by Brazil’s bank officials plan to increase interest rates at the start of the year to combat rising inflation due to economic growth and ensure financial stability.

The expected alterations, in policy could result in lending conditions that might influence the speed of economic expansion.

Many professionals think that Brazil’s economy is robust enough to handle any setbacks due, to its labour market foundations and is well positioned for a sustainable rebound amidst challenges.

The recent decrease in the unemployment rate to an all-time low of 6.1 % indicates Brazil’s resilience and potential for growth.

The country seems to be moving in a direction towards recovery, with government investments growing consumer demand and increasing job opportunities.

Despite the progress made in the economy of Brazil so far and the positive trends observed lately; there are still obstacles to overcome such as concerns, about rising prices and uncertainties, in the economy that loom ahead of us.

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Tokyo inflation rose sharply in December, and with it rose the expectations of a Bank of Japan (BOJ) interest rate hike in early 2024.

Consumer prices in the Japanese capital increased by 3.0% year-over-year, up from 2.6% in November, according to government data.

Core inflation, which excludes fresh food and energy costs, rose to 2.4% from 2.2% the previous month.

The BOJ, which has maintained an ultra-loose monetary policy for years, is now finally seeing signs that inflation may be sustainable.

While the rest of the world is still in the fight against higher inflation figures, Japan is now considering whether a tighter policy will be the way forward.

Inflation drivers: key factors

Energy prices were a key driver of Tokyo’s December inflation increase.

The end of government subsidies for gas and electricity in late 2023 led to a sharp 13.5% rise in energy costs.

These subsidies, however, are set to return from January through March 2024, likely distorting inflation figures in the months ahead.

Services prices rose by 1.0% in December, up slightly from 0.9% in November.

Economists view this as a sign that higher wages are beginning to push up prices in the service sector.

Wage increases, supported by a tight labour market, could further strengthen inflationary pressures.

The jobs-to-applicants ratio remained steady at 1.25 in November, meaning there were 125 jobs available for every 100 job seekers.

Is Japan ready for a rate hike?

The latest inflation figures align with the BOJ’s 2% inflation target, a benchmark the central bank has long struggled to meet consistently.

However, the December data suggests that the BOJ may finally see enough momentum to justify further policy normalization.

Governor Kazuo Ueda has indicated that the BOJ will base its next steps on incoming data, including wage trends and global economic conditions.

The Tokyo CPI figures act as a leading indicator for nationwide inflation.

With Japan’s nationwide CPI hovering near multi-decade highs, the BOJ has already ended its negative interest rate policy and moved its short-term rate to 0.25%.

Analysts are now forecasting at least one rate hike early in 2024, possibly at the BOJ’s January or March meeting.

Japanese economy: mixed signals

While inflation and labour market conditions suggest that the BOJ might hike rates, other economic data paint a different picture.

Factory output fell by 2.3% in November, marking the first decline in three months.

Weak global demand, particularly for semiconductor equipment and automobiles, has weighed on Japan’s export-reliant economy.

Retail sales, however, provided a glimmer of strength, rising 1.8% in November compared to the previous month.

Year-on-year growth was 2.8%, slightly above the inflation rate, driven by increased spending on clothing and consumer goods.

How will yen react?

The Japanese yen has been under pressure, trading near a five-month low against the US dollar.

The USD/JPY pair recently hovered around 157.70, down from a monthly high of 158.08.

A weaker yen has fuelled inflation by increasing import costs, particularly for energy and raw materials.

Currency movements remain a key consideration for the BOJ.

Finance Minister Katsunobu Kato has warned against sharp, one-sided moves in foreign exchange markets and hinted at potential interventions if the yen’s depreciation accelerates.

Will BOJ hike rates?

The BOJ’s next monetary policy meeting on January 23-24 is shaping up to be a kye event for Japan’s economic outlook in 2025.

Analysts are divided on whether the central bank will move quickly to raise rates or wait for more clarity on wage growth and global economic trends.

One factor to watch is Japan’s annual wage negotiations, which typically conclude in the first quarter.

If wages show significant growth, the BOJ could feel more confident about the sustainability of its inflation target.

Governor Ueda has repeatedly emphasized that durable wage-driven inflation is a critical prerequisite for further tightening.

Japan’s evolving monetary policy could affect global markets.

The BOJ has been a key source of liquidity for global financial markets due to its long-standing commitment to low rates.

A shift toward higher rates in Japan could tighten liquidity and influence bond yields worldwide.

Additionally, the yen’s movements could have far-reaching implications for global trade.

A stronger yen might reduce Japan’s export competitiveness, while a weaker yen could exacerbate global inflation through higher import costs.

Tokyo’s inflation rise signals that Japan’s long battle with deflation may be turning a corner.

While higher energy prices and a tight labour market point to a potential rate hike, other economic data alongside global risks make the BOJ’s decision anything but straightforward.

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